REDUCE TAX LIABILITY WITH EXPERT PLANNING FOR CRYPTOCURRENCY AND DIGITAL ASSETS
Every trade, stake, and NFT sale is a taxable event, whether you realize it or not.
At Proffitt Corner Advisors, we provide smart digital asset tax planning, handling everything from reporting, planning, and strategy, so nothing surprises you at filing.
$1.3M+
Client Tax Savings
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- IRS Enrolled Agent
- Integrated Tax & Exit Planning
- Nationwide Client Base
- Confidential Advisory Process
THE IRS KNOWS MORE THAN YOU THINK
The IRS taxes almost everything that happens in a crypto wallet, including trades, swaps, staking rewards, and NFT sales. Most people don’t realize how much of their activity qualifies until they’re looking at a filing problem.
Since 2025, the IRS has had significantly more visibility into crypto activity. Proffitt Corner Advisors’ crypto tax services exist for exactly this reason.
Digital Asset Categories Covered
Cryptocurrencies
Bitcoin, Ethereum, and altcoins. Trading, selling, and using crypto can all trigger reportable events.
NFTs
Sales, royalties, and creator income may each have different tax treatment under NFT taxation rules.
Stablecoins
Often assumed to be tax-neutral. The tax treatment of stablecoins depends on how they are used and whether a gain is realized.
DeFi and Staking
Staking income, yield farming, and liquidity pool activity can all create income or capital gain events.
DIGITAL ASSET TRANSACTIONS
THAT MAY TRIGGER A TAX OBLIGATION
A lot of crypto activity is taxable. Some of it surprises people. Here is what the IRS looks at and what falls under Proffitt Corner Advisors' digital asset tax compliance and crypto tax services work.
Transaction Types
OUR CRYPTO AND DIGITAL ASSET TAX SERVICES
From a simple trading portfolio to multi-chain DeFi activity, NFT collections, and Web3 business entities, Proffitt Corner Advisors covers the full range of digital asset tax work.
CRYPTO TAX PLANNING AND IRS REPORTING
If you’ve traded, sold, or earned crypto, you have tax obligations. And if you have activity across multiple exchanges and wallets, those obligations are complicated to calculate. Our crypto tax services cover both sides, reducing what you owe through proactive digital asset tax planning and making sure what you file is correct, complete, and defensible.
What This Covers
- Capital gains planning and tax loss harvesting
- Income timing strategies for staking and yield
- Multi-exchange and multi-wallet data reconciliation
- Accurate gain and loss calculations with cost basis tracking
- IRS crypto tax reporting, including Forms 8949, Schedule D, and more
- Multi-year projections for active investors
Who This Is For
Crypto Investors
High Volume Trader
Long Term Holders
Multi-Exchange Users
NFT TAX SERVICES
NFT taxation is one of the more misunderstood areas of digital asset tax. Our NFT tax services cover all the possible scenarios, and we know how the IRS approaches the investor vs creator distinction that determines which rate applies.
What This Covers
- NFT capital gains tax for investors and collectors
- NFT creator tax and primary sale income classification
- Royalty income reporting from secondary sales
- NFT to crypto swap tax treatment
- Business vs investment treatment determination
- NFT trading activity reconciliation across platforms
Who This Is For
NFT Collectors
Digital Artists
NFT Flippers
Royalty Recipients
DEFI TAX PLANNING AND STAKING REWARDS TAX
DeFi activity is where crypto taxes get genuinely complex. Our DeFi tax planning covers every type of on-chain activity your portfolio generates, using IRS guidance and current case law to classify each event correctly.
What This Covers
- Staking income is reported as taxed at receipt, with gain calculated on disposal
- Proof of stake validator and delegation reward reporting
- Yield farming and liquidity pool income
- Token swap and bridge transaction tax treatment
- Stablecoin tax treatment and transaction reporting
- Airdrop and protocol incentive income
Who This Is For
DeFi Users
Multi-Chain Investors
Staking Participants
Yield Farmers
Liquidity Providers
BUSINESS AND ENTITY DIGITAL ASSET TAX
Businesses holding crypto, DAOs, Web3 startups, and companies accepting digital payments face a different layer of digital asset tax compliance. We handle the full scope of business-related digital asset tax requirements.
What This Covers
- Crypto held on a business balance sheet
- Digital asset transaction tax for business payments
- Entity structuring for Web3 and crypto companies
- Token issuance and treasury accounting
- Crypto payroll and contractor payment tax treatment
- Digital asset income reporting for startups and DAOs
Who This Is For
Web3 Startups
DAOs
Token Issuers
Crypto Businesses
Crypto Accepting SMBs
WHY PROFESSIONAL CRYPTO TAX PLANNING MATTERS
What Happens When Crypto Taxes Are Filed Incorrectly
IRS audits are targeting crypto specifically
The IRS has expanded dedicated crypto enforcement resources. Mismatches between exchange 1099s and what is reported on your return can now trigger automatic flags. Unreported digital asset transactions are a known audit trigger.
Penalties compound quickly on unreported income
Failure to report crypto income can lead to accuracy-related penalties that add 20 to 25 percent on top of the tax owed. For larger portfolios, this amount can increase quickly, and interest continues to accumulate from the original due date.
Overpaying taxes is just as common as underpaying
Without proper cost basis tracking and tax loss harvesting, many investors end up paying more tax than necessary. Gains may be reported without offsetting losses, and default accounting methods may be used even when more tax-efficient approaches are available.
Multi-wallet activity is difficult to reconcile manually
Active crypto investors often use multiple exchanges and wallets. Over time, this creates thousands of transactions that must be reconciled correctly. Manual tracking frequently results in missing transactions or incorrect reporting.
OUR STEP-BY-STEP CRYPTO TAX APPROACH
Here is exactly how Proffitt Corner Advisors' crypto tax services take you from a messy transaction history to a clean, IRS-compliant return, with a planning strategy built in.
(Free Consultation)
Portfolio Review
We start by mapping everything, including wallets, exchanges, DeFi platforms, and NFT marketplaces, so we understand the full scope of your digital asset activity and what needs to be reported.
(Multi-Source Aggregation)
Data Reconciliation
We pull transaction data from all available sources, reconcile it across wallets and exchanges, and calculate accurate gains, losses, and income using the correct cost basis method.
(Planning First)
Tax Strategy
Before filing, we review tax loss harvesting opportunities, income timing strategies, and structural adjustments that can reduce what you owe this year and in the future.
(Audit Ready Filing)
Reporting and Filing
We prepare all required IRS forms, including Form 8949, Schedule D, Schedule 1, and any applicable business-related digital asset reporting, ensuring everything is integrated correctly into your return.
(Year-Round Support)
Ongoing Planning
Crypto tax is not a once-a-year problem. We continue working with you throughout the year by monitoring positions, identifying planning opportunities, and keeping you ahead of regulatory and reporting changes.
DIGITAL ASSET INVESTORS AND BUSINESSES WE HELP
Our crypto tax services are built for every digital asset activity that goes beyond a basic buy-and-hold position. Here’s who we mostly work with:
- Individual Crypto Investors
You have been accumulating, trading, or holding crypto for years. You want to understand your real tax position and ensure you only pay what you legally owe, not more.
- NFT Traders and Creators
You have bought, sold, or created NFTs and are unsure whether your income is taxed as capital gains or ordinary income. We understand the distinction and how it affects your tax rate.
- DeFi Participants
You participate in staking, yield farming, or liquidity pools and have activity across multiple protocols. We reconcile your on-chain transaction history and ensure it is reported accurately.
- High Volume Traders
You execute thousands of transactions across exchanges and platforms. Manual tracking is unrealistic. We specialize in accurate digital asset transaction reporting at scale.
- Web3 Founders and Startups
Your business deals with token issuance, treasury management, or crypto payroll. Digital asset accounting and tax compliance for Web3 companies requires specialized expertise.
- Crypto Accepting Businesses
You accept cryptocurrency as payment or hold digital assets on your balance sheet. We manage the reporting requirements for digital asset income and business transactions so you remain compliant.
WHAT SETS OUR CRYPTO TAX TEAM APART
Most tax firms do not specialize in digital assets. When you work with a dedicated cryptocurrency tax advisor, you are not relying on someone learning as they go. Proffitt Corner Advisors' crypto tax services handle the full complexity of digital asset taxation.
We specialize in digital asset taxation, and it is not an add-on
Our team works specifically with crypto, NFTs, DeFi protocols, and stablecoin transactions for both investors and businesses. This is not something we squeeze in between standard tax filings. It is a core focus of our practice.
We reconcile multi-exchange and on-chain activity accurately
We pull transaction data from major exchanges and wallets. All data sources are reconciled into a complete and accurate transaction history before anything is reported on your return.
We plan before filing, not the other way around
Our cryptocurrency tax advisory process begins with strategy. We evaluate opportunities for tax loss harvesting, income timing, and entity structuring before any tax return preparation begins. Filing follows planning, not the other way around.
Everything we file is audit-ready
We document cost basis calculations, income classifications, and DeFi tax treatment so that if the IRS ever requests clarification, the supporting records are already prepared.
We stay current as regulations evolve
IRS crypto guidance, broker reporting requirements, NFT tax positions, and stablecoin treatment continue to change. We monitor these developments and update our approach so your filings remain compliant.
FREQUENTLY ASKED QUESTIONS
Yes. The IRS treats crypto as property, which means selling, trading, or spending it can all trigger a tax obligation. It doesn't matter whether you converted to dollars or not. If value changed hands, it likely needs to be reported. Proffitt Corner Advisors helps you figure out exactly what applies to your activity, so nothing gets missed at filing.
Generally, yes. Swapping a volatile crypto for a stablecoin is still a taxable exchange in the eyes of the IRS. The fact that the stablecoin holds a steady value doesn't change the treatment. Most people assume stablecoins are a safe harbor. They're not, and that assumption has caught a lot of filers off guard.
NFT sales are treated as capital gains transactions. If you bought an NFT and sold it for more, that gain is taxable. If you created and sold NFTs as a business activity, the income may be taxed as ordinary income. The IRS has also signaled that certain NFTs could be classified as collectibles, which carry a higher long-term capital gains rate. The right treatment depends on how you acquired and used them.
Staking rewards are taxed as ordinary income at the time you receive them, based on the fair market value of the tokens on that date. This catches a lot of people off guard because the tax is owed even if you never sold the rewards. When you eventually sell those tokens, any gain or loss on top of that original value is then treated as a capital gain.
The IRS now receives transaction data directly from exchanges through 1099 reporting. Unreported crypto income can trigger an audit, back taxes, accuracy-related penalties of 20 to 25 percent, and interest that accumulates from the original due date. In serious cases, willful non-reporting can escalate further. Proffitt Corner Advisors works with clients to get filings current, including amended returns for prior years where activity was missed.
Yes, and this is one of the most underused tools in crypto tax planning. Capital losses from crypto can offset capital gains dollar for dollar. If your losses exceed your gains, up to $3,000 can offset ordinary income per year, with the remainder carried forward. Tax loss harvesting, done correctly before year-end, can meaningfully reduce what you owe.
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STAY COMPLIANT AND OPTIMIZE YOUR CRYPTO TAX SERVICES
Whether you have been active in crypto for years or are just getting started, a free conversation with our team will show you exactly where you stand, what risks may exist, and how Proffitt Corner Advisors’ crypto tax services can help reduce exposure while keeping you fully compliant.